Flash Report January 2017

Proposed pro-growth fiscal policies, including changes to corporate tax rates and a reduced regulatory burden, dominated investor focus during the first four weeks of the new year. Post-election exuberance pushed US equity markets to record highs, despite growing turmoil amongst historically strong trade partners. Real economic growth fell short of expectations during the fourth quarter (1.9% vs 2.2%) as net exports predictably declined in response to a strong US dollar and tepid global growth. Business investment, a harbinger of growth, continues to improve, signaling underlying momentum in the economy.